Value-added tax to be cut to 8 pct from February

A draft government decree reduces value-added tax on many products and services from the current 10 percent to 8 percent from Feb. 1.

The decree on tax reduction to foster economic recovery approved by the National Assembly will also make expenses on pandemic prevention deductible.

The VAT cut will lead to a loss of some VND49.4 trillion (over $2.1 billion) in revenues, according to the Ministry of Finance.

The deductible expenses will lead to a loss of VND2 trillion.

The lower VAT rate will not apply to telecommunications, information technology, financial activities, banking, securities, insurance, real estate, metal, and prefabricated metal products, mining (excluding coal), coke, refined petroleum, chemicals, and chemical products, and goods and services subject to excise tax.